11 January 2018: Economic growth stalls

There you have it: the World Bank thinks that the global economy might be in trouble. Although the world economy has grown a healthy 3% last year, the perspectives for the upcoming years are less rosy. This is the main message of a report published by the World Bank this week. In the next five years, the economic growth of advanced economies will shrink and development countries have reached their peak as far as this growth is concerned. The main driver behind this stall are demographics. Populations in many countries around the world are getting older on average. A process that has been taking place in many advanced countries for years now, but will also hit the growth countries of the last decades, such as China, in the upcoming period.
It remains to be seen if the observation by the World Back will affect the rise of stock prices in the short term. It is probably not enough to scare investors away from the stock markets. These markets remain attractive as long as there is an abundance of cheap money and interest rates remain low. Expect a peak in stock prices to coincide with the moment the Fed will announce a second hike in interest rates later this year. Mostly likely moment: the month of September.

white-chapel-logo-smallThe major US stock indices closed slightly lower on Wednesday. Investors reacted to signals that China is considering halting the purchases of American debt papers. The S&P 500 lost 0.11%, the NASDAQ declined 0.14% and the Dow closed 0.07% lower. Still, volatility eased: the VIX sank below 10 points once again (-2.6%). UVXY ETFs also recorded a loss and closed 2% lower. XIV ETNs gained 1%.
Danny Daredevil had to give up yesterday’s gains. His RSS dropped to -12%. Adventurous Anny is still holding a cash position. Her RSS remained unchanged at 23%. Solid Suzy and Lazy Larry were the winners of the day among our models. Their RSS rose to 116%.
None of our models gave a trading signal at the end of yesterday’s session.

Model Holds Start date

RSS

YTD

QTD

AAR

Danny Daredevil UVXY 1 January 2016

-12.30%

-14.01%

-14.01%

-6%

Adventurous Anny Cash 6 March 2017

22.91%

0.00%

0.00%

27%

Solid Suzy XIV 6 March 2017

116.21%

7.24%

7.24%

147%

Lazy Larry
XIV 6 March 2017

116.21%

7.24%

7.24%

147%

RSS = Return Since Start | YTD = Year-To-Date | QTD = Quarter-To-Date | AAR = Average Annual Return

 

RS_v05-small

Sudoku (I)

Nobody asked for it.
So here it is: our first Sudoku.
The solution will be published in one of our upcoming blog posts.